In times of a downturn, oil and gas market was unstable and a number of companies suffered. Nowadays, oil price is double it was a year ago. Crucial decisions had to be made and some were brutal, especially in upstream where companies such as Schlumberger, Halliburton and Baker Hughes cut jobs and made their employees redundant. Obviously, at that time downstream did not thrive but large fuel margins helped companies survive. Surprisingly, in spite of unpleasant situation one of the supermajors – Royal Dutch Shell decided to bid for BG acquisition.

In April 2016, Royal Dutch Shell announced that BG acquisition had been agreed for 70$ billion. Nearly a year past, in February 2017, the takeover was completed with a final price $52 billion.

When it comes to focus areas, Shell is known for its highly advanced fuels and lubricants produced and sold with substantial margins in downstream. Talking about BG, its operations are mainly exploration and extraction of natural gas and oil as well as the production of liquefied natural gas (LNG). Clearly, such a merger creates an interesting business and what is more, new opportunities in oil and gas industry.

Acquisition of BG seems to be a new strategy and significant chance for development in upstream. The merger made Royal Dutch Shell the world’s largest producer of LNG. The market reacted positively on merger news. Both Shell and BG Group shares increased rapidly. Even though, Shell has deepend its debt the advantages of the acquisition were considered worth acquiring. Surely, it is a big deal and hopefully this happening will enhance competition among other supermajors.

Rapid advances in technology such as sensors, big data or data virtualizations give our industry opportunity to effective use of digital technologies, to collect and chiefly analyze gathered data from wells. This is a game changing process leading to increased survivability of companies in downturn times.

Average offshore rig has 30,000 sensors that generate many terabytes of data daily and for now only less than one percent of collected data is being used – rest is not analyzed. Situation looks similar when it’s about oil and gas equipment, only three to five percent is connected. Although conception of vigorously working Internet of Things (IoT) is rather on poor level at this moment, operators using a predictive data driven approach to maintenance experience 36 percent less unplanned downtime.

Now imagine possibilities of algorithms which could analyze data gathered from sensors inside wells and machines on an ongoing basis, without storing it. This could provide many new solutions based on processed data – we could drastically increase efficiency, improve our decision making and knowledge about reservoirs.

Lower oil and gas prices forced companies to reduce costs and data analysis is a promising way to make it easier. In the new era of digital technology, data is very powerful tool to generalize from. That’s why upgrading technologies and enabling Internet of Things will be main focus for the industry in upcoming years – to keep costs low while enhancing efficiency and ensuring long term business growth.

Depending on David Eyton (BP group head of technology) words, our oil and gas reserves in 2050 achieved through this new technology could be bigger than 150% of forecasted amount of reserves available when best of actually available technologies were used.